White House Urban Entrepreneurship Summit: Part One
By: ellis j. still
“Entrepreneurs work 18 hours a day so that they do not have to get a job”
– John Hope Bryant, summit closing speaker
On Monday, June 6th, 2011, I participated in the White House Urban entrepreneurship Summit. When I first got the invitation to attend, I was blown away by the fact that I would be able to not only attend such an event, but to be able to provide feedback on my experiences as an entrepreneur as it relates to formulating federal, state, and local public policy.
The event was held at Newark, New Jersey’s Rutgers University Center for Urban Entrepreneurship & Economic Development (CUEED), in partnership with the White House Office of Public Engagement, the White House Domestic Policy Council, Office of Russell Simmons, The Office of the Honorable Corey Booker, Fund for Public Advocacy, Operation HOPE, Small Business Administration, Startup America Partnership, and featured a host of panelists & speakers. The event was broadcast via live streaming through the White House’s website.
Photo Courtesy of Valerie Mason-Robinson
Over 40 panelists, speakers and facilitators participated in the summit, with approximately 600 people in attendance (according to the Star Ledger). To summarize, the goal of the event as described by the organizers centered on “President Barack Obama’s vision to win the future by out-innovating, out-educating and out-building the rest of the world. The purpose of this event is to discuss best practices with urban entrepreneurs and hear their feedback on how the Administration and the private sector can best support their growth and success in the global economy.”
Russell Simmons was the keynote speaker. To summarize his address, “Entrepreneurs have ideas that no one believes will happen. Operate from the comfort zone that you already have everything that you need to succeed. The imagination is God. If you have enough of it, things will happen. If you have enough Faith and resiliency, it will happen. Use that creativity to serve underprivileged communities.”
There were three panelist sessions and one series of three breakout sessions. The topics include:
- Unleashing Ideas: Barriers and Challenges to Urban Entrepreneurs
- Investing in Urban Entrepreneurs: Creating Funding/Financing Urban Entrepreneurs
- Business & Government: Cross-sector Solutions to Spark Entrepreneurship and Startups in Urban Communities
There was also a series of special announcements. One of which was by the Institute for Entrepreneurial Leadership (IFEL) “the Institute for Entrepreneurial Leadership and 550 Broad Street negotiated a deal this past Friday to open a 9,000 square foot small business office center at 550 Broad Street, Newark, NJ. The facility will offer low cost virtual, cubicle and fully furnished office spaces in addition to conference rooms, training space, lounge space and shared administrative support. Facility members will be nurtured in a supportive, entrepreneurial environment designed to accelerate business startup and next level growth.”
Much was discussed at the summit, so rather than trying to include everything in one post, I decided to create a series of short blog posts that paraphrases the discussion points of each session. If you were at the White House Summit, or if you are an entrepreneur or author entrepreneur (independent author), feel free to add your feedback to the summit. If you were not able to attend, you may still feel free to mention your challenges in entrepreneurship as well.
Question: Did you know that if everyone in the United States hired one person, there would be no unemployment? What is stopping you from using your passion and your God given gifts to start your business?
© 2011, Ellis J. Still. All rights reserved.
Disclosure of Material Connection: I have not received any compensation for writing this post. I have no material connection to the brands, products, or services that I have mentioned. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255
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ellis
ellis j. still 
8 comments
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June 9, 2011 at 9:22 am
Isaiah Miller
Did anyone / group take on the responsibility of publishing the findings? Will anyone / group take any actions to ameliorate the problems noted? Will there be a follfow up conference?
June 9, 2011 at 9:29 am
Ellis Still
I believe the master of ceremonies mentioned that feedback from the breakout sessions will be compiled and emailed to those in attendance at some point. Anything beyond that is a question for the organizers or the individual / group whose area the specific issue falls into. Great question!!! :- )
June 9, 2011 at 9:24 am
Snotti St. Cyr
This seems very interesting and productive, Mr. Still. What did you learn there, exactly, that can be applicable to help achieve the short- and long-term goals of urban entrepreneurs?
June 9, 2011 at 9:30 am
Ellis Still
Good evening:
That is a great question… one that would be impossible to address here, since there were many topic areas that were touched on. These will be addressed in forthcoming writings as mentioned in the blog post above. Feel free to subscribe to my blog by email or RSS feed to automatically get these posts.
However, I will say that it is important to remain flexabe. Your company vision stays the same, but as unforseen opportunities occur, be ready to make changes while keeping in line with your vision. Thanks for writing!!!
ellis
June 9, 2011 at 9:26 am
Rick Rybeck
Thanks for sharing your experiences at the Summit. I look forward to future installments.
I notice that one of the topics was: “Unleashing Ideas: Barriers and Challenges to Urban Entrepreneurs.” It occurs to me that one of the primary barriers for small businesses (startups and established ones as well) is rent. Government policies inadvertantly, but dramatically increase the cost of rent for most businesses (and households as well).
The property tax rate on building values is typically about 1% or 2% of value. But unlike a sales tax (which is paid only one time), the property tax on building improvements is paid every year that improvements add value to the building. Using a “net present value” calculation shows that the typical property tax on buildings has the economic impact of a sales tax of between 10% and 20%. That’s higher than the sales taxes that we impose to discourage alcohol and tobacco consumption! At the same time, relatively low taxes on land values encourages real estate speculation, which artificially constricts the supply of developable land, but results in real land price inflation — at least until the speculative bubble bursts and prices tumble.
Businesses don’t do well during either the “boom” or the “bust” phases of the real estate roller coaster. During the “boom” phase, speculators will outbid a business for space. During the “bust” phase, speculators who bought at the peak of the bubble are not willing to relinquish space for less than they paid, even though the market rate has fallen.
Fortunately, there is a remedy that some jurisdictions have used with success. They reduce the property tax rate on building values while increasing the tax rate on land values. The jurisdictions collect the same revenues, but the incentives facing property owners are very different. No longer are they penalized with higher taxes for maintaining and improving their buildings. And they aren’t rewarded with lower taxes for allowing buildings to deteriorate or sit vacant.
This change makes it more affordable to undertake weatherization or other improvements that would provide important business and employment opportunities that cannot be outsourced. At the same time, higher land taxes actually place downward pressure on land prices. So, the change makes both land and buildings more affordable — and this is a major boost for businesses and residents alike.
More information on this strategy can be found at http://www.justeconomicsllc.com
June 9, 2011 at 9:54 am
Ellis Still
Good morning Rick:
Thank you for posting. I agree that rent is a formidable challenge for small business. Yet also, I have found that rent for office space within new developments are especially high simply due to the fact that construction costs are high.
Thank you for your insights and solutions for making office space more affordable for small businesses… start up, or otherwise. Have a great day!!!
ellis
June 11, 2011 at 10:44 am
Calvin Gladney, LEED AP
Great conversation. Another key barrier we’ve seen is the cost of tenant improvements. Small retail or other service businesses often don’t have the working capital or cash flow to cover TI costs, irrespective of whether they can “afford” the rent. Alternatively, they drain their working capital to pay for TIs and it ruins their ability to weather downturns, unexpected capital calls or slow start-up periods. Secondly, many small businesses (and also landlords) don’t accurately understand what a tenant can “afford” for rent. It’s just as important for owner/operators to understand retailer /small business”back-of-the-envelope” metrics for what is a proper rent-to-revenue ratio in their particular industry. Owners shouldn’t rent to retailers/small businesses where the rent puts them out of whack with industry standards for acceptable rent in their business line in their geographic market. Small businesses need to know this for themselves so they can properly negotiate rents and select space.
June 13, 2011 at 11:32 am
Ellis Still
Hi Calvin:
As an early stage retailer myself, this is great information. We are currently operating online to build up our brand and cash flow towards the goal of opening brick and mortar stores. We are also using this time to gain further insights from information that we come across, such as the feedback that you offered above, that we can use to forward our goals.
To add to your comments, in my previous career life I worked for various urban real estate, planning & design firms (my most recent role was conducting feasibility analysis for mixed-use developments). I have seen cases of unexpected TI cost overruns due to delays during the permit or inspection process, construction delays, and a host of other things that can go wrong. Therefore, if the retailer is not aligned with a designer and general contractor that knows how to navigate the implementation process in an efficient way, it could cost the retailer a significant amount of capital.
Thanks!!! :- )
ellis